Weighted Voting

A participant's voting power is directly tied to their economic stake in the protocol, typically measured by token holdings. This creates a system of proportional representation where larger stakeholders have greater influence, aligning voting outcomes with financial commitment. Common implementations include:

• Token-weighted voting: 1 token = 1 vote.
• Quadratic voting: Power increases with the square root of tokens held to reduce whale dominance.
• Time-locked boosts: Voting power is amplified by committing tokens for a longer duration.

Token holders can delegate their voting power to other addresses without transferring asset custody, enabling liquid democracy. Sophisticated systems use vote escrow models, where tokens are locked for a period to receive non-transferable governance tokens (e.g., veTokens) with boosted voting power. This mechanism incentivizes long-term alignment, as seen in protocols like Curve Finance, where veCRV determines gauge weights for liquidity pool incentives.

Governance actions require minimum thresholds to be proposed and passed, preventing spam and ensuring sufficient participation. Key metrics include:

• Proposal Threshold: The minimum stake required to submit a governance proposal.
• Quorum: The minimum percentage of total voting power that must participate for a vote to be valid.
• Approval Threshold: The required majority (e.g., simple majority, supermajority) for a proposal to pass. These parameters are critical for security and decisiveness.

Votes are tallied on-chain, and if a proposal passes, its encoded actions are often executed automatically via a Timelock Controller or similar smart contract. This process includes:

• Snapshot Voting: Off-chain signature collection for gas-free voting, with on-chain execution.
• On-chain Voting: Direct, gas-consuming voting on the blockchain.
• Multisig Execution: Approved proposals are executed by a designated multisig wallet. The separation of voting and execution introduces a delay (timelock) for security reviews.

Weighted voting is inherently Sybil-resistant because acquiring additional voting power requires acquiring additional capital (tokens), making it economically prohibitive to create many fake identities (Sybils) to sway a vote. This contrasts with one-person-one-vote systems which are vulnerable to Sybil attacks. The cost of attack scales linearly with the desired influence, providing a fundamental economic security guarantee.

A key critique is the potential for tyranny of the majority, where large stakeholders (whales) can consistently outvote smaller holders. Mechanisms to mitigate this include:

• Quadratic Voting: Diminishing returns on voting power per token.
• Conviction Voting: Voting power increases the longer a vote is held.
• Multisig with Guardians: A fallback council can veto proposals deemed harmful.
• Bicameral Systems: Separating proposal power from final approval power.

A model for curating lists (e.g., reputable oracles) where token holders stake to add or challenge entries. Voting is a Schelling game—participants are rewarded for aligning with the majority view. This creates a decentralized, incentive-aligned curation mechanism.

• Use Case: Curating data providers, whitelists, or known entities.
• Incentive: Voters earn rewards for correct votes and lose stake for incorrect ones.

Voting power is weighted by token lock-up duration (time) or vesting schedule. This aligns voters with the long-term health of the protocol by requiring commitment. Models like ve-tokenomics (e.g., Curve's veCRV) grant boosted voting power and rewards for longer lock-ups.

• Principle: Skin in the game through temporal commitment.
• Effect: Encourages long-term alignment over short-term speculation.

A mechanism designed to reduce the dominance of large holders by making the cost of voting power increase quadratically. It aims to reflect the intensity of preference more than pure capital weight.

• Gitcoin Grants: Uses quadratic funding, where community donations are matched based on the square of the sum of square roots of contributions, valuing broader participation.
• While computationally more complex, it's explored in DAOs to mitigate whale dominance.

Systems that allow token holders to delegate their weighted voting power to experts or representatives, creating a representative democracy model.

• MakerDAO: MKR holders often delegate to recognized delegates who vote on their behalf, aggregating power for informed governance.
• Snapshot with Delegation: Platforms like Snapshot facilitate easy delegation, allowing passive holders to contribute their weight to active participants.

An advanced form of delegation that is fluid and reversible. Voters can delegate their weighted votes on specific topics or for limited times.

• Vote Streaming: Projects like Paladin Protocol allow users to temporarily lend their governance tokens (and their voting power) to delegates, who can use it for a set period before it returns.
• This increases capital efficiency and participation flexibility.

Protocols that implement layered governance, where weighted voting occurs at different levels or is gated by councils.

• Aave: Features a two-tier system: Aave Governance for high-level proposals and a Risk Guardian role with special powers to pause markets in emergencies.
• Arbitrum DAO: Uses a Security Council elected by weighted vote of ARB holders to perform critical, time-sensitive upgrades.

In a token-weighted voting system, a participant's voting power is directly proportional to the quantity of governance tokens they hold and commit to a proposal. This creates a one-token-one-vote model, where larger stakeholders have greater influence. The mechanism is foundational to many Decentralized Autonomous Organizations (DAOs) and protocol upgrades.

• Vote Weight Calculation: Power = (User's Staked Tokens / Total Staked Tokens) * 100.
• Example: In a Compound governance vote, a user with 10 COMP tokens has 10 times the voting power of a user with 1 COMP token.

The primary security concern of weighted voting is whale dominance, where a small number of large token holders (whales) can unilaterally control governance outcomes. This centralizes decision-making power and can lead to proposal censorship, treasury misuse, or changes that benefit large holders at the expense of the minority.

• Sybil Resistance: While weighted voting is inherently Sybil-resistant (splitting tokens creates no extra power), it trades this for plutocratic control.
• Mitigation: Protocols may implement vote delegation, quadratic voting, or time-locked voting to dilute concentrated power.

Weighted voting embodies a key governance trade-off: it aligns voting power with economic stake (skin-in-the-game) but sacrifices egalitarian participation. This prioritizes capital efficiency and stakeholder accountability over broad-based, one-person-one-vote equality.

• Pro: Voters with larger financial stakes bear more risk from decisions, incentivizing informed voting.
• Con: It can marginalize small, active community members whose expertise isn't reflected in token holdings, potentially stifling innovation and diverse input.

The measurable, token-based nature of voting power creates a clear market for vote buying and manipulation. Entities can borrow or temporarily acquire large quantities of governance tokens (flash loans) to pass or defeat a proposal, then return the tokens. This undermines the integrity of the governance process.

• Example: An attacker could use a flash loan to amass voting power, approve a malicious treasury transfer, and repay the loan—all within a single transaction block.
• Defenses: Implementing vote escrowing (tokens locked for a duration) or quorum requirements increases the cost and difficulty of such attacks.

Vote delegation is a common feature built atop weighted voting systems, allowing token holders to delegate their voting power to a representative or expert without transferring token custody. This can improve governance participation and decision quality but introduces new trust assumptions.

• Mechanism: A holder signs a delegation transaction, assigning their vote weight to a delegate's address.
• Risk: It can lead to delegate cartels or lazy voting, where power becomes re-concentrated in a few delegates, recreating centralization risks.

Weighted voting is implemented via on-chain or off-chain mechanisms, each with distinct security properties.

• On-Chain Voting: Votes are transactions recorded on the blockchain (e.g., Compound, Uniswap). This is cryptographically verifiable and enforceable but incurs gas costs and exposes vote direction.
• Off-Chain Voting (Snapshot): Votes are signed messages tallied off-chain. This is gasless and allows for rapid signaling, but results are not automatically executed, requiring a separate, trusted process to enact.